Atal Pension Yojana: Can You Withdraw Money Before 60? Know the Rules

The Atal Pension Yojana is a government-backed pension scheme designed to help eligible individuals build financial security for their retirement. While subscribers can receive a guaranteed minimum monthly pension after turning 60, many people may wonder whether they can withdraw their money before reaching that age. Here is what the APY premature exit rules say and what subscribers should know.

What Is Atal Pension Yojana?

Atal Pension Yojana (APY) is aimed particularly at workers in the unorganised sector and people seeking a regular income during their retirement years. Eligible individuals can join the scheme between the ages of 18 and 40 and make regular contributions until they turn 60.

An awareness campaign was recently held in Maharashtra's Thane district to highlight the benefits of APY. The initiative involved the Bank of Maharashtra, the State Level Bankers' Committee and financial-sector institutions, with officials explaining how the scheme can help people prepare financially for their later years.

How To Open an APY Account

You can enrol in Atal Pension Yojana through a participating bank or post office. If you already have a savings account and have completed Aadhaar-based KYC, you can use the account to register for APY.

Those who do not have a bank or post office savings account will first need to open one and complete the required KYC formalities before enrolling in the pension scheme.

How Much Pension Does APY Provide?

One of the key features of APY is the choice of a guaranteed minimum monthly pension. Subscribers can choose a pension of:

• ₹1,000 per month
• ₹2,000 per month
• ₹3,000 per month
• ₹4,000 per month
• ₹5,000 per month

The contribution required depends on factors such as the subscriber's age when joining and the pension amount selected. Starting at a younger age generally means a longer contribution period.

Can You Apply for APY Online?

Yes, online registration may be available if your bank offers APY enrolment through its net banking facility.

You can log in to your bank's net banking portal, look for the APY option and provide the required information. Subscribers can also set up auto-debit, allowing the applicable contribution to be deducted from the linked bank account at regular intervals.

How To Apply for APY Offline

For offline enrolment, visit your bank or post office and request the APY registration form. Fill in the required details and submit the form along with the necessary KYC documents, including Aadhaar details where required.

After submitting the application, the bank or post office will process the request and provide an acknowledgement or receipt. An SMS may also be sent to the registered mobile number once the enrolment is processed.

What Happens After You Turn 60?

APY contributions continue until the subscriber reaches the age of 60, subject to the scheme's rules. After reaching 60, the subscriber can start receiving the selected pension amount as a monthly payment.

The subscriber needs to approach the bank or post office and submit the required request for receiving the pension. After the formalities are completed, the pension is paid according to the applicable APY rules .

In the event of the subscriber's death, the spouse is entitled to receive the pension, subject to the scheme's provisions.

Can You Withdraw APY Money Before 60?

Premature exit from Atal Pension Yojana is not generally permitted. However, an exit before the age of 60 can be allowed in certain exceptional circumstances, including the subscriber's death or specific cases involving serious illness.

If an APY account is closed prematurely under the applicable rules, the subscriber may receive their own contributions along with the interest earned on those contributions. However, the benefits relating to any government co-contribution and the interest earned on it may not be payable.

Therefore, anyone planning to enrol in APY should understand the premature-exit provisions before making a decision.

Should You Continue APY Until 60?

APY is structured primarily as a long-term retirement savings and pension scheme. Since the benefits are designed around continuing the account until the age of 60, subscribers should ideally consider their long-term financial needs before opting for early closure.

If you are considering an APY account, check the latest rules and contribution requirements with your bank or post office before enrolling.